US approves some exports of light oil 

As the oil industry pushes the Obama administration to lift a longstanding ban on the export of crude oil, the Commerce Department has granted two Texas companies permits to export a light, processed form of oil, according to people familiar with the matter.

Over the last year, pressure has increased on the Obama administration to end the ban on crude oil exports, which has been in place since the 1970s Arab embargo magnified concerns about the oil supply. But there has been a boom in domestic oil production thanks to breakthroughs in production techniques, including hydraulic fracturing, or fracking.

The Commerce Department, which can issue permits to companies to export crude oil, has not done so. There is no ban on exporting processed petroleum products such as gasoline or jet fuel.

Two Texas companies, Pioneer Natural Resources of Irving and Enterprise Products Partners of Houston, produce an ultralight form of oil known as a condensate, which is distilled during production. The Commerce Department has reclassified that oil as a processed product, thus permitting those companies to export it, according to people familiar with the situation.

Industry analysts said the permits did not necessarily signal a broader shift by the administration toward exporting crude oil.

“This is not a signal that the administration has changed its policy with regard to exports,” said David Goldwyn, an energy analyst and former head of the State Department’s energy program under Secretary of State Hillary Rodham Clinton. “This is a confirmation that these two requests are reclassified as products rather than crude oil. But the folks who want this to be a break in the dam are engaging in wishful thinking.”

The Commerce Department seemed to make that clear late Tuesday. “There has been no change in policy on crude oil exports,” a spokesman, Jim Hock, said.

 

Source: bostonglobe

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